Business Models in Education
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If you are an entrepreneur eager to revolutionise education, figuring out how to make money is a daunting task. In this workshop, in conjunction with Education Entrepreneurs and Startup Weekend EDU, we explore the market opportunity for edtech startups in Asia, as well as different business models in education, the advantages and disadvantages of each, and some inspiring examples of start ups that have found success thus far.
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Business Models in Education
- 2. BROUGHT TO YOU BY:
- 3. AGENDA ● Welcome & Introductions ● Overview of Ed Tech Market in Asia ● Intro to the Business Model Canvas ● The Challenges of Traditional Education ● The Challenges of Online Education ● Business Model Case Studies ● Q&A
- 4. ● Managing Director, Fresco Capital ● Invest in early stage startups in US and Asia ● Early employee at General Assembly ● Established General Assembly in Asia ● Previously Goldman Sachs Allison@allison_baum INTRODUCTIONS
- 5. ● 10 edtech investments ● Seed stage to Series A ● US & Asia ● Review 2-3 companies per day ● 100: 1 No/Yes Ratio INTRODUCTIONS
- 6. OBJECTIVES ● Understand the landscape for education start ups in the US and Asia ● Use Business Model Canvas to describe traditional education business model ● Examine strengths and weaknesses of new business models in education
- 7. ED TECH IS ON THE RISE 0 500 1,000 1,500 2,000 2,500 2010 2011 2012 2013 2014 Millions Private Investment in Learning Technology Companies (US$ Millions)
- 8. WHY ASIA? MARKET SIZE. US$59.90bn: Size of global ed tech market by 201816 600 million: K-12 students in Asia 5 years: Time until Asia is the largest regional market 16 300 million: People learning English in China 195 million: College graduates in China by 2020 40% income spent on education
- 9. WHY ASIA? CAPITAL. • US$554.4mn total invested in 2014 • 24% total edtech investment in China (vs. 10% the year before)
- 10. WHY ASIA? EXITS. +200% in 2014 (mostly M&A)
- 12. DISCLAIMER There’s No Substitute for a Great Product
- 15. Job Preparation Life Experience Alumni Network Access to Experts Advisory Test Prep Campus Recruiting Students Alumni Researchers Parents Tuition ResearchReal Estate Faculty Product Development Research Education Land Talent High Schools Testing Providers Government Endowment Alumni Research Investment Corporations TRADITIONAL CASE STUDY:
- 16. CHALLENGES IN TRADITIONAL EDUCATION High fixed costs Inefficient infrastructure Limited access Differentiated learning styles Content development / relevance
- 17. THE ADVANTAGES OF TECHNOLOGY Increased access Increased efficiency Very low cost Personalized content Adaptive delivery Measurable outcomes
- 18. THE UNIVERSITY OF THE FUTURE?
- 19. CHALLENGES IN TECH: ENGAGEMENT
- 20. CHALLENGES IN TECH: $$$ Sustainability New business models Monetizing content Scaling quickly Long-term returns
- 22. CASE STUDY:
- 23. BUSINESS MODELS IN ED TECH B2B: Selling to businesses or government B2C: Direct to consumer B2C2B: Freemium B2B2C: Resellers or Channel Partners All of the above J
- 24. B2B: SELLING TO INSTITUTIONS The Good: ● Large market size ● Large contract sizes ● Long term commitments ● Sticky customers The Bad: ● Long, difficult sales cycle ● Users vs. customers ● Procurement process ● Customized needs
- 25. B2B: CASE STUDY
- 26. B2C: DIRECT TO CONSUMER The Good ● No bureaucracy ● Easier sale ● User and customer needs aligned The Bad ● Smaller overall market size ● Lower price point = more customers ● Retention ● Marketing Funnel
- 27. B2C: CASE STUDY
- 28. B2C2B: FREEMIUM Free $ $$ Teachers, Students Department, School Institution, District
- 29. B2C2B: FREEMIUM The Good: ● Less Bureaucracy ● Users become advocates ● Flexibility ● Demonstrate Traction The Bad: ● Balance between free & premium ● Can free users be converted? ● Time spent on non- paying customers
- 32. B2B2C: RESELLERS The Good: ● Increased reach ● Large contract sizes ● Upfront payments ● Leverage existing relationships ● Bypass bureaucracy The Bad: ● Revenue share ● Lower margins ● Limited feedback mechanisms ● No control over customer relationships / support
- 33. CASE STUDY
- 34. CASE STUDY
- 35. CASE STUDY
- 36. ADDITIONAL RESOURCES More info available: ● Business Models ● Reference Companies ● Canvas bit.ly/edbusinessmodels
- 37. Friday May 15 - Sunday, May 17 Follow LearnLab on WeChat: “ghkj2015”